Newspaper article Evening Chronicle (Newcastle, England)

Huge Shortfall Hits Free OAP Travel Bid

Newspaper article Evening Chronicle (Newcastle, England)

Huge Shortfall Hits Free OAP Travel Bid

Article excerpt

Byline: By Peter Young

Councils warn of cuts and tax rises

Passengers face big cuts in public trans-port after the Govern-ment dealt the North East a multi-million pounds cash blow.

Ministers are refusing to provide the Tyne & Wear Passenger Authority with the extra money needed to fully fund free bus travel for pensioners in April.

The authority will get around pounds 12.7m, leaving a cash gap of pounds 7.7m which could mean cuts in loss-making bus routes, care bus services for housebound people, and higher concessionary fares for children.

The blow was delivered in the Government's cash settlement for local authorities.

PTA leaders will continue to press Ministers for extra cash and officers will draw up a report setting out the options for cuts for a meeting of the PTA later this month.

Free bus travel for pensioners was announced by the Chancellor in his last budget but today Coun Peter Allen, Newcastle City Council's executive member for resources, said he'd failed to fund the scheme properly leaving the Tyne & Wear local authorities to find the balance of the cash.

"The Government has left the Tyne & Wear authorities with a major problem," he said. "We face putting up the council tax which is unacceptable or making drastic cuts in public transport."

Town hall chiefs face a battle to keep the lid on April's council tax bills after the North East received the worst budget settlement in the country for the next two years.

Councils in the North East will receive an average of 2.7% extra next year, compared with 3% nationally and 3.5% the following year against 3.8% nationally.

Ministers say council tax rises should be below 5%.

Local Government Minister Phil Woolas said there was no excuse for excessive increases and warned the Government would cap the spending of councils which step out of line.

But council leaders insist some authorities will face tough choices between increasing taxes or cutting services.

In Newcastle, where the council's Liberal Democrat leaders were aiming for a tax increase of around 3%, there was dismay. …

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